How Donald Trump Lied to Conceal His Moscow Business Partner

Donald Trump has told many lies and
falsehoods. He’s lied about the Russia scandal. He’s lied about
his ties to organized crime. Perhaps he’s lied so much that
freshly excavated prevarications don’t register greatly. Yet
recent news reports revealing that Trump was pursuing a huge
development deal in Moscow in late 2015 and early 2016 show that
during the campaign Trump committed a tremendous act of
deception.

This mammoth duplicity was encompassed in a small fib. On
December 2, 2015, during an interview with an Associated Press
reporter, Trump was asked about his relationship with a fellow
named Felix Sater. Trump, who was then the front-runner in the
GOP presidential nomination contest, replied, “Felix Sater, boy,
I have to even think about it. I’m not that familiar with him.”
He referred questions to his Trump Organization. One of his
lawyers, Alan Garten, subsequently told the AP that Sater once
prospected for real estate deals for the Trump Organization and
that the arrangement lasted for six months in 2010.

What neither Trump nor Garten said was that—at that very
moment—Trump was in the middle of the deal to build a Trump
Tower in the Russian capital and that Sater had put together the
venture. As he was running for president, Trump was hiding this
project from the American public, and he was insisting he barely
knew the man at the center of it. This was serious deceit.

Trump’s claim that he was unfamiliar with Sater was regarded at
the time as absurd by journalists who have followed Trump’s
career; it appeared the candidate was attempting to distance
himself from a one-time felon. Sater had a substantial criminal
record. In the early 1990s, when he was in his mid-20s, Sater
went to jail for about a year after he smashed a broken
margarita glass into the face of a man during a barroom
altercation. After that, he became part of a mid-1990s stock
swindle tied to the Mafia and Russian organized crime. To escape
going back to jail, he pleaded guilty to racketeering and became
a cooperating witness for the FBI.

While an informant for the bureau, Sater hooked up with a real
estate development firm in New York City called Bayrock, and in
the 2000s he cooked up various projects with Trump. Many fizzled
out and ended up in lawsuits. But at least one was built: the
Trump SoHo hotel and condominium project. (That deal also
prompted a lawsuit in which buyers of units there claimed to
have been defrauded by Trump, his adult children, and others.
Trump and his co-defendants settled the case, agreeing to refund
90 percent of $3 million in deposits but admitting no
wrongdoing.) Throughout this stretch, Sater, who was born in
what is now Russia and who boasted connections there, worked
with Trump to try to land a tower project in Moscow, which had
long been a dream for Trump.

In 2007, the New York Times revealed Sater’s past as a criminal
and reported that Trump was in business with a man who had been
accused of “conspiring with the Mafia to launder money and
defraud investors.” Trump told the Times he knew nothing of
Sater’s dark past. Though Sater departed Bayrock after the
Times’ article, Trump’s organization brought him on board three
years later, and Sater was wheeling and dealing, seeking
projects for Trump and handing out Trump Organization business
cards describing him as a “senior advisor to Donald Trump.”

In subsequent years, Trump issued conflicting statements about
his relationship with Sater. In a 2011 deposition, Trump
acknowledged that he used to speak to Sater “for a period of
time.” Yet in a 2013 deposition, Trump said, “If he were sitting
in the room right now, I really wouldn’t know what he looked
like.” Trump had plenty of reason to distance himself from his
felonious onetime business partner. Sater wasn’t simply
controversial; he posed a serious risk for Trump. If Trump had
been aware of Sater’s felonious and fraudulent past before the
Times story came out, such knowledge could taint business deals
the Trump Organization made involving Bayrock and possibly
create a legal liability.

So it was no surprise when Trump in late November 2015 acted as
if he had never met Sater. But now it’s obvious that his
dishonest response to the question about Sater was far more
significant.

Around September 2015, Sater approached Michael Cohen—a lawyer
for Trump and an executive vice president at the Trump
Organization—with a proposal for the construction of a luxury
hotel, office, and residential condominium building in the
Russian capital that would be called Trump Tower Moscow. In a
recently released statement, Cohen noted that the project called
for a Russian company named I.C. Expert Investment Company to
develop the building, and Trump would license his name to the
venture. Cohen said he “primarily communicated” with the Russian
firm through Sater. Cohen recalled, “Sater claimed to have
appropriate relationships within the business community in
Russia in order to obtain the real estate, financing, government
permits, and other items necessary for such a development…Sater
acted as a deal broker and would have been compensated by the
licensee if the proposal had been successful. I have known Mr.
Sater for several decades and I routinely handled communications
with him regarding the proposal.”

This was Sater’s deal. According to a source familiar with this
aspect of the Trump-Russia investigation, Trump was fully aware
that Sater had brokered the agreement. And around late October
2015, Trump himself signed a letter of intent with I.C. Expert
Investment to proceed with the project.

The arrangement would have put $4 million in upfront fees in
Trump’s pocket. Trump’s company solicited building designs from
different architects and engaged in discussions regarding
potential financing for the proposal. (I.C. Expert Investment
projects were sometimes financed by Russian banks under US
economic sanctions. Last month, Sater told the New York Times
that he lined up financial support from VTB Bank, an institution
partially owned by the Kremlin and now under US sanctions.)

Sater considered this endeavor related—perhaps crucial—to
Trump’s presidential campaign. In October, when he forwarded
Cohen the letter of intent for Trump to sign, he wrote, “Lets
make this happen and build a Trump Moscow. And possibly fix
relations between the countries by showing everyone that
commerce & business are much better and more practical than
politics. That should be Putins message as well, and we will
help him agree on that message. Help world peace and make a lot
of money, I would say thats a great lifetime goal for us to go
after.” A few weeks later, Sater emailed Cohen: “I arranged for
Ivanka to sit at Putins private chair at his desk and office in
the Kremlin. I will get Putin on this program and we will get
Donald elected…Our boy can become president of the USA and we
can engineer it. I will get all of Putins team to buy in on
this, I will manage this process.” In mid-January, Cohen, at
Sater’s suggestion, sent a letter to Vladimir Putin’s office to
ask for help in obtaining permission for the construction from
the Russian government.

Ponder all this for a moment. At the time Trump was running for
president, he was endeavoring to pull off a major deal in Moscow
that required government permission. That is, if Putin didn’t
favor this project, it wouldn’t happen. Trump’s right-hand legal
man even asked Putin’s office to help them. And through all
this, Trump was making positive statements about Putin. One
example: In mid-December 2015, Trump said on MSNBC’s Morning Joe
that Putin was a better leader than Barack Obama, and when Joe
Scarborough asserted that Putin “kills journalists that don’t
agree with him,” Trump scoffed at him and said, “He’s running
his country and at least he’s a leader, unlike what we have in
this country…I think our country does plenty of killing also.”

Trump was defending a repressive leader—but one with whom he was
trying to do business in private. Throughout the 2016 election,
people wondered why Trump consistently made oddly positive
remarks about Putin. Part of the answer is clear: You cannot
develop major construction projects in Moscow if you criticize
Putin.

Back to Sater. As Trump was in the thick of it with this
Sater-brokered project, he gave the impression he hardly had any
idea who Sater was. It is hard to see Trump’s answer as anything
other than a deceptive reply designed to hide the fact that he
was attempting to land a Putin-sanctioned deal in Russia (that
would earn him several million dollars) at the same time he was
pitching himself as the best possible president of the United
States. The truthful answer would have been: “Sure, I know Felix
Sater, and right now I am working with him to develop a major
hotel-residential-retail project in Moscow that can only move
forward with the permission of the Russian government.” How
would such a reply have played in the campaign?

The Sater project, like Trump’s previous efforts to develop a
Trump Tower in Moscow, eventually fell apart. Cohen says he
decided to abandon the idea “for business reasons” in late
January 2016. But Sater remained in the Trump orbit. In early
2017, he and Cohen worked on a Russia-friendly peace plan for
Ukraine and tried to get the Trump White House to adopt it.

Trump pulled off a con during the presidential campaign. He
insisted he cared only about US interests—while he was privately
negotiating a deal in Moscow that could only happen with the
assent of Putin’s government. In and of itself, this should be a
major scandal. Yet Trump got away with it. And to do so, he had
to lie about his relationship with Sater. This was not the first
instance in which he had misrepresented his connection to Sater.
But it was the most important one.